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Mango
Warns of Scam - Sapa - 2009-09-23

Johannesburg - An e-mail scam offering vastly discounted
flights is currently in circulation, airline Mango said on Wednesday.

"The e-mails offer incredible deals to international
and local destinations across all airlines," Mango CEO Nico
Bezuidenhout said.

"But it is all hot air... these fares seem too
good to be true, and they are," he added.

Bezuidenhout said that over the past week Mango -
and other carriers - had seen a renewed flood of invalid bookings
sold to unsuspecting consumers.

In just two days Mango declined eight travellers who
had made bookings and paid through the e-mail scam, he said.

"This is just on our airline, I shudder to think
what these fraudsters have achieved across all airlines, domestically
and internationally," he said.

Earlier this year Mango issued a consumer advisory,
warning South Africans about the scam, "after which public
awareness dampened the activities", the airline said.

However, it seemed that the fraudsters were trying
their luck again, Mango added.

Mango along with other industry players would continue
to cooperate with authorities.

"Prevention is always the first defence against
crime and I would like to urge consumers to ensure that they only
engage with airlines through official websites, call centres and
travel agents or, of course, to purchase in person at any Shoprite,
Checkers or Checkers Hyper Money Market Counter in our instance,"
Bezuidenhout said.

"We've always said we would report on the results
and tell the taxpayer how we have performed. We have never promised
to publish the audited financial report."

In an unverifiable statement that contained neither
the actual audited financial statements, nor any other numbers,
Mango said on Tuesday it had achieved revenue growth of 31% (on
an unspecified amount). This saw it clinch a R10.9m net profit and
4% growth in market share.

Bezuidenhout only insisted to Fin24.com that the statements
on which the information was gleaned had been audited, and signed
off by an auditing company.

Mango's stance on not releasing the audited results
was a complete turnaround to its promises soon after its launch
that it would invite Fin24.com to view the audited results.

Bezuidenhout repeated the promise on no less than
four occasions to Finweek and Fin24.com during both 2006 and 2007.

Mango spokesperson Hein Kaiser also told Fin24.com
on Tuesday that releasing the actual numbers was dependent on shareholder
South African Airways (SAA), which itself revealed a R398m net profit
a day earlier.

When Fin24.com asked SAA chief executive Chris Smyth
of Mango's results he said that was "confidential company information".
Smyth distanced himself from releasing the audited statements. "We
never made that promise," said Smyth. "You'll have to
ask Bezuidenhout about it."

Smyth said in the same manner as British Airways does
not release its segmental results, SAA wouldn't release its own.

All Smyth was prepared to say was that Mango's value
had improved by at least R10m/year over the past two years. He didn't
disclose the company's current value.

Asked at what rates SAA leased its aircraft to Mango,
Smyth only said at "market" rates. Another question was
whether it was indeed correct that SAA continues to pay Mango's
fuel bill, which Smyth denied. Mango said on Tuesday it did not
hedge its fuel bill.

However, Mango said it focused on maintaining the
lowest cost base asset utilisation and customer service. Citing
everything else, without any information that would be contained
in audited financial statements, Mango patted itself on the back
about most awards on the market and 86% on-time performance.

Mango was controversially launched through a "R100m
shareholder loan" into the fiercely competitive domestic airline
market during 2006, amid much criticism at a time when SAA was itself
unable to reach profitability.

Then SAA chief executive Khaya Ngqula said the company
would operate at "arm's length from SAA" and would not
get any other financial assistance.

Some of Mango's competitors challenged it to make
a net profit. Kulula.com even promised to host a party in Mango's
honour should it produce an audited positive bottom line.